When is a Byrider licensee liable to Licensor and other franchisees for damages related to the Licensed System?

According to Byrider's 2025 Franchise Disclosure Document, a licensee is liable to Byrider and any affected franchisee for damages related to the Licensed System under specific circumstances. The licensee becomes liable for any direct or consequential damages caused by their use of the Licensed System if that use has not been explicitly approved by Byrider in writing. This means that if a franchisee deviates from the approved methods of using the software and this deviation results in harm, they are responsible for covering the resulting costs.

Furthermore, the licensee is also liable for damages caused by a third party's activities if those activities stem from the licensee's unapproved use of the Licensed System. This extends the franchisee's responsibility to include situations where their unauthorized use indirectly leads to damages inflicted by others. The requirement for written approval underscores the importance of adhering to Byrider's established protocols for using the Licensed System.

This clause protects Byrider and its franchisees from financial losses resulting from misuse or unauthorized modifications of the Licensed System. For a prospective franchisee, this highlights the need to strictly adhere to approved usage guidelines and to seek written permission for any deviations. Failure to do so could result in significant financial liabilities, emphasizing the importance of understanding and complying with the terms outlined in the franchise agreement and related documents.